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Signed Into Law
Signed June 20, 2025Effective 2025-09-01
SB2798

Regular Session

Relating to certain statutes of limitations for criminal offenses, including the statute of limitations for certain fraud offenses.

Government Affairs & Regulatory Compliance Analysis

SB2798: Government Affairs Overview

SB2798 establishes a uniform seven-year statute of limitations for all fraud offenses under Chapter 32 of the Texas Penal Code, replacing varied 3-to-5-year windows. Effective September 1, 2025, this legislation significantly expands the liability exposure period for corporate entities and necessitates an immediate overhaul of document retention schedules to prevent the destruction of evidence in potential future criminal proceedings.

Sen. Charles Creighton·Senate Bill·Regular Session

Moderate
Low Cost
Effective:2025-09-01
Enforcing Agencies

Texas District Attorneys • Texas Law Enforcement Agencies

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SB2798
Moderate
Relating to certain statutes of limitations for criminal offenses, including the statute of limitations for certain fraud offenses.
Moderate Compliance Urgency
Requires near-term attention
Cost Impact
Low
Effective
2025-09-01
Enforcing Agencies
Texas District AttorneysTexas Law Enforcement Agencies
Primary Author: Sen. Charles Creighton
89th Texas Legislature
jdkey.com
01

Compliance Analysis

Key implementation requirements and action items for compliance with this legislation

Implementation Timeline

  • Effective Date: September 1, 2025.
  • Compliance Deadline: August 31, 2025. Your IT systems and document retention policies must be updated *before* this date to prevent the auto-deletion of records that fall within the new, extended liability window.
  • Agency Rulemaking: None. This is a statutory change to the Code of Criminal Procedure enforced by the Judiciary and District Attorneys; no regulatory agency (e.g., SOS, OAG) is required to promulgate rules.

Immediate Action Plan

  • Direct IT/CIO: Immediately suspend any auto-deletion protocols set for less than 7 years for financial and communication data.
  • Update Legal Templates: Revise standard vendor contracts to reflect a 7-year audit right effective immediately for new engagements.
  • Audit Insurance: Verify that Fidelity Bonds (Employee Theft) cover claims where the crime is discovered up to 7 years after commission.
  • Review Open Investigations: Instruct internal audit teams to review "cold" fraud cases from the last 3-4 years; these files should remain open rather than being archived.

Operational Changes Required

Contracts

  • Vendor Audit Rights: Update standard Master Services Agreements (MSAs). You must extend your contractual right to audit vendor books from the standard 2-4 years to 7 years. Without this, you may have the legal right to press charges for fraud in Year 6, but lack the contractual access to evidence required to prove it.
  • Indemnification Clauses: Revise indemnification language regarding criminal acts or fraud. Replace fixed-year survival clauses with "for the duration of the applicable statute of limitations."

Hiring/Training

  • Internal Audit & Fraud Units: Retrain internal investigators. Cases previously closed or rejected due to the expiration of a 3-year or 5-year window may now be actionable. Investigators must recalibrate case management software to flag Chapter 32 offenses as "active" for 7 years.

Reporting & Record-Keeping

  • Document Retention Policy: This is the primary operational impact. You must mandate a 7-year minimum retention period (recommended 10 years for safety) for:
  • Point-of-sale transaction logs.
  • Loan applications and underwriting data.
  • Vendor invoices and payment verifications.
  • Executive and procurement email communications (vital for establishing intent).

Fees & Costs

  • Data Storage: Anticipate a marginal increase in data storage costs due to the longer retention requirement for high-volume transaction logs.
  • Insurance Premiums: Consult with your broker regarding Directors & Officers (D&O) and Fidelity Bond coverage. Ensure "tail coverage" or "discovery periods" align with the 7-year liability window.

Strategic Ambiguities & Considerations

  • The "Zombie" Provision: The law applies to offenses committed before the effective date *if* the original limitation period has not yet expired.
  • *Risk:* A fraud committed in 2023 (originally expiring in 2026) will automatically extend to 2030 on September 1, 2025.
  • *Ambiguity:* There will be confusion regarding which specific date applies to complex, continuing fraud schemes. Defense counsel will argue for the shorter term; Prosecutors will argue for the extension.
  • "All Offenses" Scope: By removing specific lists and applying the 7-year rule to *all* of Chapter 32, obscure or lesser-used fraud statutes now carry the same long tail as major embezzlement. Do not assume minor infractions will expire quickly.

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Information presented is for general knowledge only and is provided without warranty, express or implied. Consult qualified government affairs professionals and legal counsel before making compliance decisions.

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Legislative Timeline

This bill's path through the Texas Legislature

Filed
Mar 14, 2025
Passed Senate
Apr 24, 2025
Passed House
May 23, 2025
Signed
Jun 20, 2025
Effective
Sep 1, 2025
TopicsCrimesCrimes--miscellaneousCriminal ProcedureCriminal Procedure--generalFraudStatutes of LimitationsMinorsMinors--crimes Against
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Senate Authors

Sen. Charles CreightonRepublican · Primary Author

House Sponsor

Rep. Mitch LittleRepublican · Primary Sponsor

Bill Text(with markup)

View bill text in multiple formats on Texas Legislature website

Fiscal NoteView Original

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Quick Reference

Frequently Asked Questions

Common questions about SB2798

Q

What does Texas SB2798 do?

SB2798 establishes a uniform seven-year statute of limitations for all fraud offenses under Chapter 32 of the Texas Penal Code, replacing varied 3-to-5-year windows. Effective September 1, 2025, this legislation significantly expands the liability exposure period for corporate entities and necessitates an immediate overhaul of document retention schedules to prevent the destruction of evidence in potential future criminal proceedings.

Q

Who authored SB2798?

SB2798 was authored by Texas Senator Charles Creighton during the Regular Session.

Q

When was SB2798 signed into law?

SB2798 was signed into law by Governor Greg Abbott on June 20, 2025.

Q

Which agencies enforce SB2798?

SB2798 is enforced by Texas District Attorneys and Texas Law Enforcement Agencies.

Q

How significant are the changes in SB2798?

The regulatory priority for SB2798 is rated as "moderate". Businesses and organizations should review the legislation to understand potential impacts.

Q

What is the cost impact of SB2798?

The cost impact of SB2798 is estimated as "low". This may vary based on industry and implementation requirements.

Q

What topics does SB2798 address?

SB2798 addresses topics including crimes, crimes--miscellaneous, criminal procedure, criminal procedure--general and fraud.

Q

What are the key dates for SB2798?

Key dates for SB2798: Effective date is 2025-09-01. Consult with legal counsel regarding applicability.

Q

What are the penalties under SB2798?

SB2798 establishes the following penalties: criminal penalty of Statute of Limitations extended to 7 years (previously varied, often 3 or 5 years) for All offenses under Chapter 32, Texas Penal Code (Fraud), including credit/debit card abuse, fraudulent transfer of a motor vehicle, and false statements to obtain credit, unless a longer period (e.g., 10 years for Forgery) already applies.. Consult with legal counsel for specific applicability to your situation.

Need Strategic Guidance on This Legislation?

JD Key Consulting is an Austin, Texas-based government affairs firm led by James Dickey, former Chairman of the Republican Party of Texas. We specialize in Texas regulatory compliance and legislative strategy for data centers, energy, banking, and manufacturing.

Legislative data provided by LegiScanLast updated: January 11, 2026